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Interview On Cause Marketing With a Trade Magazine Reporter, Part II

The second half of an interview with Carol Gustafson, a writer with Western & English Today, a trade magazine to the equine industry.

3. What are the secrets to success? (The ways to make any CRM effort pay dividends for both the charity and the business.)

The secret sauce is planning and execution. In most cases, cause-related marketing is a promotion. And like any promotion it requires resources. But if resources are in short supply, to a degree you can substitute planning and creativity for money.

  • Successful campaigns frequently rely on a ‘MacGuffin.’ Filmmaker Alfred Hitchcock used the term to describe the mechanical element in movie plot that impelled action. In the case of cause-related marketing, sometimes the cause itself is the MacGuffin… certain breast cancer charities come to mind, for instance. The MacGuffin could be celebrity involvement, a sweepstakes of some sort, or strong media appeal.
  • You must figure out a way to grab media attention that is appropriate for the promotion.
  • If it makes sense for the cause and your company, you need to strongly consider some sort of event element. Events in cause-related marketing are powerful because they are one of the few media that allow you to effectively transition from awareness and interest, to desire, commitment and action in one fell swoop.

4. You've said that youth are an ideal market for CRM. Why is that?

The Millennials, aka Gen Y, the 76 million kids born from 1982 to 2002 have grown up with something called ‘service learning.’ That is, they get school credit for doing community service. That experience stays with them.

  • In a Pew study released in January called “A Portrait of Generation Next” 56 percent of 18-25 year olds say that they “feel empowered to bring about social change,” an increase of eight percentage points over the Gen Xers who were asked the same question in 1990.
  • Millennials volunteer more than any of other generation at their age, a reported 50 percent.
  • They expect companies to contribute to their communities and in general Generation Y is not characterized by cynicism about life in general or cause-related marketing in particular.
  • A September 2007 study commissioned by the American Marketing Association and conducted by the Opinion Research Corporation found that more than 50 percent of Americans were immune to cause-related marketing come-ons. (More on this and other recent studies in a later post.) But when broken out by age, the study found that the age cohort most responsive to cause-related marketing was 18-24 year-olds. Forty-six percent of that age group said that they were “more likely to buy a product or service if a portion of the price were donated to an important cause.” By contrast only 31 percent of those aged 45-64 felt the same way.

5. You've also identified eco-based CRM marketing as an area of growth. What is the potential in that area?

Until Al Gore won an Academy Award and a Nobel Prize in the same year, I would have said that Americans were still perhaps 12 months behind the ‘Green Wave.’ But it’s increasingly evident to me that the wave is cresting right now in America.

  • Venture capitalists are bypassing the latest Internet fads to fund startups that manufacture solar panels.
  • GE has on tour an energy-efficient railroad locomotive that works like a Toyota Prius, storing energy during braking to use when ascending hills.
  • Wal-Mart stores dim their lights and sell organic milk

Right now, I see two broad classes of greens. There are the Americans willing to embrace eco-based cause-related marketing at almost any cost. These are the people who shop at Whole Foods/Wild Oats and pay perhaps a 40 percent premium for doing so.

Behind them is the much larger group who see the sense of saving energy, creating less waste, reducing their carbon ‘footprint,’ etc… so long as the price is right. These are the people who buy CFLs (compact florescent lightbulbs) at Wal-Mart.

They don’t pay as much for a CFL as it would have cost 3 years ago. But still they’re paying several times the cost of an incandescent bulb a little further down the same shelf.

Think about that for a moment. With millions of twisty light bulbs Wal-Mart manages to reshape its image, improve energy efficiency for the country as a whole, and lower the customer’s power bill, all by selling a CFL that has higher price point than the old incandescent bulbs, but a lower price point than their competitor’s CFL. It is, to use Peter Lynch’s term, a “triple bagger!”


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